Medicaid expansion has not only reduced the overall number of people in the U.S. without health insurance — it has also narrowed racial gaps in health insurance coverage.
According to a new report from The Commonwealth Fund, health insurance coverage for Black, Hispanic/Latino, and white adults improved between 2013 to 2021. Additionally, the coverage gap between Black and white adults and between Hispanic/Latino and white adults shrank.
In 2013, before Medicaid expansion went into effect, 40.2% of the Hispanic/Latino population, 24.4% of the Black population, and 14.5% of the white population were uninsured. By 2021, those numbers fell to 24.5%, 13.5%, and 8.2%, respectively.
“A lot of the progress in uninsured rates going down and these disparities narrowing [is] definitely stemming from the Affordable Care Act coverage expansions,” Jesse Baumgartner, co-author of the report and senior research associate at The Commonwealth Fund, told Yahoo Finance. “Those took effect in 2014. So you see big drops between 2013 and 2016 as the marketplace subsidies came online, [and] a lot of states expanded their Medicaid programs at that time. So that’s obviously a huge driver for that progress then.”
Medicaid was expanded in 2013 through the Affordable Care Act (ACA) — commonly known as Obamacare. The provision allows households whose income falls below 138% of the federal poverty level to become eligible for Medicaid.
Following a Supreme Court ruling, however, it was left up to each state to decide whether or not to adopt the expansion. As of March 2023, 39 states and the District of Columbia have expanded Medicaid.
According to the Commonwealth Fund report, between 2013 to 2021, states that adopted the Medicaid expansion saw higher rates of insurance coverage and health care access than non-expansion states. They also saw smaller disparities between racial and ethnic groups.
While each racial and ethnic group has made significant strides in health care coverage since 2013, the gain in health care coverage for the Hispanic/Latino population has been particularly notable: Its uninsured rate shrunk by 15.7 percentage points between 2013 to 2021, the most of any demographic.
“There have been huge gains,” Baumgartner said, despite challenges stemming from less access to employer-sponsored insurance and regulations related to immigration status that impact Medicaid eligibility.
Still, the Hispanic/Latino population has the highest uninsured rate in the U.S., which Baumgartner said is “a large remaining inequity” and one that “needs the most work moving forward.”
As of October 2022, more than 91 million Americans were enrolled in Medicaid and the Children's Health Insurance Program (CHIP).
There were significant improvements between 2019 to 2021, which Baumgartner attributed to federal policy actions taken in response to the coronavirus pandemic, specifically the Families First Coronavirus Response Act and American Rescue Plan.
“What the data in this report suggests is that the federal policy actions during the pandemic... made a big impact in not only stopping coverage losses but actually resulting in some gains of coverage for all of those groups during that time,” he said.
The Families First Coronavirus Response Act, which was signed into law in March 2020, allocated $3.5 trillion in funding for things like coronavirus testing, nutrition services, and the Public Health and Social Services Emergency Fund.
The American Rescue Plan, passed a year later, expanded the eligibility for ACA subsidies and increased the amount of financial assistance for those already eligible for the ACA. These subsidies have been extended until 2025.
“The data here really speaks to the impact of those expanded subsidies and how they’ve made coverage more affordable,” Baumgartner said. “Moving forward, the things we think policymakers should keep in mind is the extension of that past 2025 as definitely another option that this data highlights.”
Starting on March 31, however, a provision of the federal policy response to the pandemic — continuous Medicaid enrollment — may come to an end, eliminating health care coverage for millions of Americans.
According to the Kaiser Family Foundation, “states that accept the enhanced federal funding can resume disenrollments beginning in April but must meet certain reporting and other requirements during the unwinding process.”
That could impact some of the recent progress on insurance coverage, particularly for Black and Latino families.
Between 2019 and 2021, uninsured rates for Black adults dropped by at least two percentage points in 14 states, while rates for Hispanic/Latino adults fell by the same amount in 19 states, according to the Commonwealth Fund report.
“The bigger question is: What can states and the federal government do to minimize coverage loss and switch people who will inevitably be moved off Medicaid?” Baumgartner said. “It’s a clear, big risk to the progress that’s been made because clearly those policies, and the continuous enrollment policies, in particular, seem to have had a pretty big impact.”
Until that specific issue can be addressed, Baumgartner said federal policymakers should focus on creating a federal fallback option for non-expansion states.
“The question becomes: How are states going to be able to get people onto other coverage, to move them over to marketplace coverage that they might be eligible for, to really minimize the disruption and keep the progress going and not have a backsliding?” he said. “That’s the real key.”